Pharmaniaga files PN17 regularisation plan, to raise RM655mil

 

Pharmaniaga fell under PN17 last February following an impairment caused by its failure to offload RM552 million worth of Covid-19 vaccines.

PETALING JAYA: Pharmaniaga Bhd submitted its regularisation plan to Bursa Malaysia today as it seeks to exit the dreaded Practice Note 17 (PN17) classification that it fell under a year ago.

The plan to revitalise one of Malaysia’s largest integrated pharmaceutical groups involves fund raising via a renounceable rights issue of new ordinary shares of up to RM354.6 million and private placement of up to RM300 million.

In a Bursa Malaysia filing today, it said the plan also entails a capital reduction of approximately RM180 million issued share capital to reduce its accumulated losses.

The deadline to submit its regularisation plan is the end of this month.

A massive impairment caused by its failure to offload RM552.3 million worth of Covid-19 vaccines sent Pharmaniaga tumbling into PN17 status on Feb 27, 2023.

The impairment led to its largest ever quarterly net loss of RM664.39 million for the fourth quarter ended Dec 31, 2022 (Q4 FY2022) from a net profit of RM85.47 million the year before.

Pharmaniaga stated that its substantial shareholders, the Armed Forces Fund Board (LTAT) and Boustead Holdings Bhd (BHB), are supporting this “strategic initiative”.

“LTAT and BHB have committed to ensure their combined entitlement to the rights issue, totalling RM190 million, will be fully taken up,” it said.

Pharmaniaga is a subsidiary of BHB, which in turn is wholly owned by LTAT.

It said the regularisation plan outlines a holistic approach to increase the equity of the group and minimise its accumulated losses.

“The rights issue offers the existing shareholders the opportunity to increase their participation in future upsides of Pharmaniaga, alongside a private placement aimed at drawing potential strategic investors to contribute to the group’s value enhancement and growth,” it added.

Pending Bursa Malaysia’s approval, the plan is projected to be fully implemented in the fourth quarter of the fiscal year ending Dec 31, 2024, said Pharmaniaga.

Its shares ended half-a-sen or 1.3% higher at 40 sen, giving it a market capitalisation of RM569.3 million. - FMT